What’s covered under home insurance and what’s not

Buying a house is considered one of the biggest purchases that a person can make in their lifetime. It is an owner’s duty to protect their home from any sort of unpredictable event. This can be done with home insurance. The scheme aims to provide all-round protection to a house and its contents. It is basically categorised into two parts- cover for damages and cover for liabilities.

Many policyholders remain unaware of what exactly their home insurance covers. If you are looking forward to buying an insurance plan for your house, there are some surprising aspects of the scheme that you should be aware of.

Some surprising things about home insurance:

1. Covers the home and also its contents: A home insurance not just protects the physical framework of the house, but also possessions like electronics and furniture. In some cases, it also covers expensive assets like precious jewellery, and artwork within specified limits.

2. Different from home loan insurance: Home loan insurance settles the outstanding home loan balance in unexpected circumstances, Home insurance covers the expenses that may have arisen from destruction or harm caused upon the insured residence's structure.

3. Covers loss caused due to a terrorist attack: Home insurance plans also cover the damages that are caused due to any terrorist attacks. This provision can be added as an optional addition or rider in the plan.

4. Covers temporary accommodation: In case the residence is undergoing repairs, home insurance will cover the expenses for temporary lodging.

What is not covered in home insurance?

There are also a few damages that go uncovered in home insurance. For example, damages caused due to lack of maintenance and war situations are not covered under the scheme.

1. Intentional damages are not covered: While home insurance covers all damages inflicted due to hazards, it doesn't provide any money in case of intentional actions resulting in destruction of property.

2. No coverage in case the home is used as an office: If the insured residence is being used as an office, then no compensation will be given to the policyholder. If the accommodation is being used for any other purpose than residential, any claim will be ruled out by the company.  

3. No claim for gradual water damage: The insurer will not process any claim if the home has deteriorated due to gradual water damage. Only damage caused by flooding or “unexpected and unintentional” water-related harm is covered